In NFC Fight, Australian Banks Call Apple’s Security Claims ‘Baseless’
A group of Australia’s biggest banks have launched the latest salvo in their dispute with Apple over third-party access to the iPhone’s NFC hardware. In a joint filing to the Australian Competition and Consumer Commission (ACCC), the banks rebuffed Apple’s claims that they should not be allowed to collectively negotiate with the tech giant over making their own mobile payment apps available on iPhones. Apple’s previous claims that allowing the banks to negotiate collectively would present security concerns were “unconvincing” and “superficial,” the banks said in their filing to the ACCC, published on Oct. 17.
The conflict stems from Apple’s policy of not allowing third-party payments apps to be installed on its mobile devices. Three of Australia’s major banks—Commonwealth Bank of Australia, National Australia Bank, Westpac—along with Bendigo and Adelaide Bank, want to offer their own iPhone payment apps that would work through the iPhone’s NFC hardware. The banks in July applied to the ACCC to collectively negotiate with Apple without violating anti-trust laws. In response, Apple argued that maintaining control over the NFC hardware is necessary for security and that providing banks direct access would undermine Apple Pay security. Further, allowing the banks to negotiate collectively would create “a troubling precedent,” in enabling the banks—which Apple called “among the most profitable financial institutions in the world”—to act as a cartel in negotiations.
In their response to the ACCC, the banks called Apple’s argument “completely baseless” and accused the company of appealing “to security without providing any explanation of how allowing choice and competition in iPhone payments would compromise that security.” Apple’s real concern, the banks argue, is “seeking for itself the exclusive use of Australia’s existing NFC terminal infrastructure for the making of integrated mobile payments using iOS devices.”
The ACCC is expected to make a final ruling sometime this month.